Choice Hotels International, Inc.
Exhibit 1
Consolidated Statements of Income
(Unaudited)
Three Months Ended December 31,
-------------------------------
Variance
2008 2007 $
%
---- ---- ---
---
(In thousands, except per share amounts)
REVENUES:
Royalty fees
$59,284 $60,623 $(1,339) (2%)
Initial
franchise and
relicensing fees
6,729 11,907 (5,178) (43%)
Procurement
services
3,498 3,680 (182)
(5%)
Marketing and
reservation
81,904 89,963 (8,059) (9%)
Hotel operations
1,253 1,207
46 4%
Other
1,826 1,595
231 14%
----- -----
--- --
Total
revenues 154,494 168,975 (14,481)
(9%)
OPERATING EXPENSES:
Selling,
general and
administrative
35,580 27,855 7,725
28%
Depreciation and
amortization
2,019 2,227 (208)
(9%)
Marketing and
reservation
81,904 89,963 (8,059) (9%)
Hotel operations
894 839
55 7%
--- ---
-- -
Total
operating
expenses 120,397 120,884
(487) 0%
Operating income
34,097 48,091 (13,994) (29%)
OTHER INCOME AND EXPENSES:
Interest expense
2,245 4,087 (1,842) (45%)
Interest and
other investment
(income) loss
4,431 1,106 3,325
301%
Equity in net
income of
affiliates
(476) (393) (83)
21%
---- ----
--- --
Total other
income
and
expenses,
net 6,200 4,800
1,400 29%
----- ----- -----
--
Income before
income taxes
27,897 43,291 (15,394) (36%)
Income taxes
9,186 15,344 (6,158) (40%)
----- ------ ------ ---
Net income
$18,711 $27,947 $(9,236) (33%)
======= ======= ======= ===
Weighted average
shares outstanding-
basic
61,166 62,086
====== ======
Weighted average
shares outstanding-
diluted
61,684 63,109
====== ======
Basic earnings per
share
$0.31 $0.45 $(0.14) (31%)
===== ===== ======
===
Diluted earnings
per share
$0.30 $0.44 $(0.14) (32%)
===== ===== ======
===
Twelve Months Ended December 31,
--------------------------------
Variance
2008 2007 $
%
---- ---- ---
---
(In thousands, except per share amounts)
REVENUES:
Royalty fees
$247,435 $236,346 $11,089 5%
Initial
franchise and
relicensing fees
27,931 33,389 (5,458) (16%)
Procurement
services
17,148 16,283 865
5%
Marketing and
reservation
336,477 316,827 19,650
6%
Hotel operations
4,936 4,692
244 5%
Other
7,753 7,957 (204)
(3%)
----- ----- ----
--
Total
revenues 641,680 615,494 26,186
4%
OPERATING EXPENSES:
Selling,
general and
administrative
118,989 101,590 17,399
17%
Depreciation and
amortization
8,184 8,637 (453)
(5%)
Marketing and
reservation
336,477 316,827 19,650
6%
Hotel operations
3,434 3,241
193 6%
----- -----
--- --
Total
operating
expenses 467,084 430,295
36,789 9%
Operating income
174,596 185,199 (10,603) (6%)
OTHER INCOME AND EXPENSES:
Interest expense
10,932 14,293 (3,361) (24%)
Interest and
other investment
(income) loss
7,760 (1,750) 9,510 (543%)
Equity in net
income of
affiliates
(1,414) (1,230) (184) 15%
------ ------ ----
--
Total other
income
and
expenses,
net 17,278 11,313
5,965 53%
------ ------ -----
--
Income before
income taxes
157,318 173,886 (16,568) (10%)
Income taxes
57,107 62,585 (5,478) (9%)
------ ------ ------
--
Net income
$100,211 $111,301 $(11,090) (10%)
======== ======== ======== ===
Weighted average
shares outstanding-
basic
61,853 64,213
====== ======
Weighted average
shares outstanding-
diluted
62,521 65,331
====== ======
Basic earnings per
share
$1.62 $1.73 $(0.11)
(6%)
===== ===== ======
==
Diluted earnings
per share
$1.60 $1.70 $(0.10)
(6%)
===== ===== ======
==
Choice Hotels International, Inc.
Exhibit 2
Consolidated Balance Sheets
(In thousands, except per
share amounts)
December 31, December 31,
2008 2007
---- ----
(Unaudited)
ASSETS
Cash and cash equivalents
$52,680 $46,377
Accounts receivable, net
43,141 40,855
Deferred income taxes
8,223 2,387
Investments, employee
benefit plans, at fair
value
- 1,002
Other current assets
16,172 15,330
------ ------
Total current assets
120,216 105,951
Fixed assets and
intangibles, net
138,867 141,679
Receivable -- marketing fees
13,527 6,782
Investments, employee
benefit plans, at fair
value
25,360 33,488
Other assets
30,249 40,484
------ ------
Total assets
$328,219 $328,384
-------- --------
LIABILITIES AND SHAREHOLDERS' DEFICIT
Accounts payable and
accrued expenses
$79,897 $96,195
Deferred revenue
47,004 48,660
Deferred compensation &
retirement plan obligations
6,960 1,002
Other current liabilities
1,206 1,659
----- -----
Total current liabilities
135,067 147,516
Long-term debt
284,400 272,378
Deferred compensation &
retirement plan
obligations
33,462 43,132
Other liabilities
12,960 22,419
------ ------
Total liabilities
465,889 485,445
------- -------
Common stock, $0.01 par
value
607 621
Additional paid-in-capital
90,141 86,243
Accumulated other
comprehensive income (loss)
(3,472) 346
Treasury stock, at cost
(835,186) (798,110)
Retained earnings
610,240 553,839
------- -------
Total shareholders'
deficit
(137,670) (157,061)
-------- --------
Total liabilities
and
shareholders'
deficit $328,219
$328,384
-------- --------
Choice Hotels International, Inc.
Exhibit 3
Consolidated Statements of Cash Flows
(Unaudited)
Twelve Months
(In thousands)
Ended December 31,
------------------
2008 2007
---- ----
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income
$100,211 $111,301
Adjustments to reconcile net income
to net
cash provided by operating activities:
Depreciation and amortization
8,184 8,637
Provision for bad debts
9,433 905
Non-cash stock compensation
and other charges 10,914 11,124
Non-cash interest and
other loss
9,300 29
Dividends received from
equity
method investments
1,180 1,245
Equity in net income of
affiliates
(1,414) (1,230)
Changes in assets and liabilities,
net
of acquisitions:
Receivables
(4,358) 1,056
Receivable - marketing
and
reservation fees,
net
(7,578) 11,997
Accounts payable
(13,138) 13,053
Accrued expenses
(3,206) (5,480)
Income taxes payable/receivable
(1,870) (5,422)
Deferred income taxes
3,073 (7,649)
Deferred revenue
(1,549) 1,493
Other assets
(1,046) (2,554)
Other liabilities
(3,737) 7,161
------ -----
NET CASH PROVIDED BY OPERATING
ACTIVITIES 104,399 145,666
------- -------
CASH FLOWS FROM INVESTING ACTIVITIES:
Investment in property and equipment
(12,611) (11,963)
Acquisitions, net of cash acquired
- (343)
Purchases of investments, employee
benefit plans
(7,802) (8,686)
Proceeds from sales of investments,
employee benefit plans
7,819 6,049
Issuance of notes receivable
(7,410) (7,395)
Collections of notes receivable
434 1,806
Other items, net
(695) (752)
---- ----
NET CASH USED IN INVESTING ACTIVITIES
(20,265) (21,284)
------- -------
CASH FLOWS FROM FINANCING ACTIVITIES:
Principal payments of long-term debt
(100,000) (422)
Net borrowings pursuant to revolving
credit facility
112,000 100,199
Excess tax benefits from stock-based
compensation
10,135 6,209
Purchase of treasury stock
(63,732) (185,935)
Dividends paid
(43,142) (40,139)
Proceeds from exercise of stock options
9,026 5,749
----- -----
NET CASH USED IN FINANCING ACTIVITIES
(75,713) (114,339)
------- --------
Net change in cash and cash equivalents
8,421 10,043
Effect of foreign exchange rate changes
on cash
and cash equivalents
(2,118) 493
Cash and cash equivalents at
beginning of period
46,377 35,841
------ ------
CASH AND CASH EQUIVALENTS AT END OF
PERIOD $52,680 $46,377
======= =======
CHOICE
HOTELS INTERNATIONAL, INC. EXHIBIT 4
SUPPLEMENTAL OPERATING INFORMATION
DOMESTIC HOTEL SYSTEM
(UNAUDITED)
For the Twelve Months Ended
December 31, 2008*
------------------------------------
Average Daily
Rate Occupancy RevPAR
---- --------- ------
Comfort Inn
$79.84 60.1%
$48.01
Comfort Suites
89.49 61.3%
54.82
Sleep
71.91 58.5%
42.10
----- ----
-----
Midscale without Food
& Beverage 80.90
60.2% 48.66
----- ----
-----
Quality
71.42 52.0%
37.15
Clarion
84.48 50.0%
42.21
----- ----
-----
Midscale with Food &
Beverage
74.18 51.6%
38.26
----- ----
-----
Econo Lodge
55.58 46.9%
26.05
Rodeway
55.04 47.5%
26.16
----- ----
-----
Economy
55.44 47.0%
26.08
----- ----
-----
MainStay
73.72 64.2%
47.34
Suburban
42.93 62.4%
26.80
----- ----
-----
Extended Stay
51.14 62.9%
32.17
----- ----
-----
Total
$74.11 55.3%
$40.98
====== ====
======
For the Twelve Months Ended
December 31, 2007*
------------------------------------
Average Daily
Rate Occupancy RevPAR
---- --------- ------
Comfort Inn
$77.14 63.1%
$48.70
Comfort Suites
87.23 65.5%
57.11
Sleep
69.67 62.5%
43.52
----- ----
-----
Midscale without Food
& Beverage 78.23
63.5% 49.70
----- ----
-----
Quality
70.30 54.2%
38.09
Clarion
80.86 51.7%
41.79
----- ----
-----
Midscale with Food &
Beverage
72.74 53.6%
38.97
----- ----
-----
Econo Lodge
54.40 48.0%
26.10
Rodeway
53.24 47.6%
25.32
----- ----
-----
Economy
54.14 47.9%
25.93
----- ----
-----
MainStay
70.04 68.5%
47.98
Suburban
40.13 67.3%
27.01
----- ----
-----
Extended Stay
47.10 67.6%
31.83
----- ----
-----
Total
$72.07 57.9%
$41.75
====== ====
======
Change
------
Average Daily
Rate Occupancy RevPAR
---- --------- ------
Comfort Inn
3.5% (300) bps (1.4%)
Comfort Suites
2.6% (420) bps (4.0%)
Sleep
3.2% (400) bps (3.3%)
--- --------- ----
Midscale without Food
& Beverage
3.4% (330) bps (2.1%)
--- --------- ----
Quality
1.6% (220) bps (2.5%)
Clarion
4.5% (170) bps 1.0%
--- --------- ---
Midscale with Food &
Beverage
2.0% (200) bps (1.8%)
--- --------- ----
Econo Lodge
2.2% (110) bps (0.2%)
Rodeway
3.4% (10) bps 3.3%
--- --------
---
Economy
2.4% (90) bps 0.6%
--- --------
---
MainStay
5.3% (430) bps (1.3%)
Suburban
7.0% (490) bps (0.8%)
--- --------- ----
Extended Stay
8.6% (470) bps 1.1%
--- --------- ---
Total
2.8% (260) bps (1.8%)
=== ========= ====
* Operating statistics represent hotel
operations from December through
November.
For the Three Months Ended
December 31, 2008*
-----------------------------------
Average Daily
Rate Occupancy RevPAR
---- --------- ------
Comfort Inn
$78.95 57.8%
$45.59
Comfort Suites
88.09 57.6%
50.73
Sleep
71.48 55.1%
39.37
----- ----
-----
Midscale without Food
& Beverage 80.00
57.3% 45.85
----- ----
-----
Quality
69.34 49.2%
34.08
Clarion
82.53 46.7%
38.51
----- ----
-----
Midscale with Food &
Beverage
71.97 48.6%
35.00
----- ----
-----
Econo Lodge
55.36 45.5%
25.19
Rodeway
53.68 44.4%
23.81
----- ----
-----
Economy
54.90 45.2%
24.80
----- ----
-----
MainStay
74.71 61.4%
45.88
Suburban
44.08 57.1%
25.17
----- ----
-----
Extended Stay
52.65 58.2%
30.67
----- ----
-----
Total
$72.97 52.6%
$38.38
====== ====
======
For the Three Months Ended
December 31, 2007*
-----------------------------------
Average Daily
Rate Occupancy RevPAR
---- --------- ------
Comfort Inn
$77.45 63.9%
$49.47
Comfort Suites
86.32 64.1%
55.29
Sleep
70.10 61.4%
43.03
----- ----
-----
Midscale without Food
& Beverage 78.31
63.5% 49.76
----- ----
-----
Quality
69.86 53.4%
37.28
Clarion
82.27 52.3%
43.04
----- ----
-----
Midscale with Food &
Beverage
72.68 53.1%
38.61
----- ----
-----
Econo Lodge
54.33 47.7%
25.89
Rodeway
52.17 46.7%
24.37
----- ----
-----
Economy
53.82 47.4%
25.52
----- ----
-----
MainStay
70.40 70.7%
49.77
Suburban
40.65 64.6%
26.24
----- ----
-----
Extended Stay
48.50 66.1%
32.04
----- ----
-----
Total
$72.16 57.6%
$41.58
====== ====
======
Change
------
Average Daily
Rate Occupancy RevPAR
---- --------- ------
Comfort Inn
1.9% (610) bps (7.8%)
Comfort Suites
2.1% (650) bps (8.2%)
Sleep
2.0% (630) bps (8.5%)
--- --------- ----
Midscale without Food
& Beverage
2.2% (620) bps (7.9%)
--- --------- ----
Quality
(0.7%) (420) bps (8.6%)
Clarion
0.3% (560) bps (10.5%)
--- --------- -----
Midscale with Food &
Beverage
(1.0%) (450) bps (9.3%)
---- --------- ----
Econo Lodge
1.9% (220) bps (2.7%)
Rodeway
2.9% (230) bps (2.3%)
--- --------- ----
Economy
2.0% (220) bps (2.8%)
--- --------- ----
MainStay
6.1% (930) bps (7.8%)
Suburban
8.4% (750) bps (4.1%)
--- --------- ----
Extended Stay
8.6% (790) bps (4.3%)
--- --------- ----
Total
1.1% (500) bps (7.7%)
=== ========= ====
* Operating statistics represent hotel
operations from September through
November.
For the Quarter Ended For the Twelve Months
Ended
--------------------- ---------------------------
12/31/2008 12/31/2007 12/31/2008
12/31/2007
System-wide
effective
royalty rate
4.23% 4.15%
4.20% 4.14%
CHOICE HOTELS INTERNATIONAL, INC. EXHIBIT
5
SUPPLEMENTAL HOTEL AND ROOM SUPPLY DATA
(UNAUDITED)
December 31, December 31,
2008
2007
------------ ------------
Hotels Rooms Hotels Rooms
------ ----- ------ -----
Comfort Inn
1,462 114,573 1,434 112,042
Comfort Suites
541 42,152 481 37,358
Sleep
365 26,867 346 25,728
--- ------ --- ------
Midscale without Food
& Beverage 2,368 183,592 2,261
175,128
----- ------- ----- -------
Quality
908 85,055 828 79,276
Clarion
150 21,497 167 23,319
--- ------ --- ------
Midscale with Food &
Beverage 1,058 106,552
995 102,595
----- ------- --- -------
Econo Lodge
816 50,812 825 50,403
Rodeway
346 20,302 276 16,523
--- ------ --- ------
Economy
1,162 71,114 1,101 66,926
----- ------ ----- ------
MainStay
35 2,694 30
2,258
Suburban
60 7,256 54
6,773
-- ----- --
-----
Extended Stay
95 9,950 84
9,031
-- ----- --
-----
Ascend Collection
21 1,353 -
-
Cambria Suites
12 1,323 4
459
-- ----- --
---
Domestic Franchises
4,716 373,884 4,445 354,139
International Franchises
1,111 98,642 1,125 97,888
----- ------ ----- ------
Total Franchises
5,827 472,526 5,570 452,027
===== ======= ===== =======
Variance
--------
Hotels Rooms %
%
------ ----- ---
---
Comfort Inn
28 2,531 2.0%
2.3%
Comfort Suites
60 4,794 12.5%
12.8%
Sleep
19 1,139 5.5%
4.4%
-- ----- ---
---
Midscale without Food
& Beverage 107 8,464
4.7% 4.8%
--- ----- ---
---
Quality
80 5,779 9.7%
7.3%
Clarion
(17) (1,822) (10.2%) (7.8%)
--- ------ -----
----
Midscale with Food &
Beverage 63
3,957 6.3% 3.9%
-- ----- ---
---
Econo Lodge
(9) 409 (1.1%)
0.8%
Rodeway
70 3,779 25.4%
22.9%
-- ----- ----
----
Economy
61 4,188 5.5%
6.3%
-- ----- ---
---
MainStay
5 436 16.7%
19.3%
Suburban
6 483 11.1%
7.1%
-- --- ----
---
Extended Stay
11 919 13.1%
10.2%
-- --- ----
----
Ascend Collection
21 1,353 NM
NM
Cambria Suites
8 864 200.0%
188.2%
-- --- -----
-----
Domestic Franchises
271 19,745 6.1%
5.6%
International Franchises
(14) 754 (1.2%)
0.8%
--- --- ----
---
Total Franchises
257 20,499 4.6%
4.5%
=== ====== ===
===
CHOICE HOTELS INTERNATIONAL, INC. EXHIBIT
6
SUPPLEMENTAL INFORMATION BY BRAND
DEVELOPMENT RESULTS -- DOMESTIC NEW HOTEL CONTRACTS
(UNAUDITED)
For the Twelve Months Ended
December 31, 2008
---------------------------
New
Construction Conversion Total
------------ ---------- -----
Comfort Inn
48 58
106
Comfort Suites
85 3
88
Sleep
72 4
76
-- --
--
Midscale without Food
& Beverage 205
65 270
--- --
---
Quality
5 147
152
Clarion
7 42
49
-- --
--
Midscale with Food &
Beverage
12 189
201
-- ---
---
Econo Lodge
4 83
87
Rodeway
3 99
102
-- --
---
Economy
7 182
189
-- ---
---
MainStay
12 -
12
Suburban
8 -
8
-- --
--
Extended Stay
20 -
20
-- --
--
Ascend Collection
1 1
2
Cambria Suites
16 -
16
-- --
--
Total Domestic System
261 437
698
=== ===
===
For the Twelve Months Ended
December 31, 2007
---------------------------
New
Construction Conversion Total
------------ ---------- -----
Comfort Inn
48 62
110
Comfort Suites
114 4
118
Sleep
71 1
72
-- --
--
Midscale without Food
& Beverage 233
67 300
--- --
---
Quality
11 153
164
Clarion
6 42
48
-- --
--
Midscale with Food &
Beverage
17 195
212
-- ---
---
Econo Lodge
3 77
80
Rodeway
2 99
101
-- --
---
Economy
5 176
181
-- ---
---
MainStay
22 2
24
Suburban
21 3
24
-- --
--
Extended Stay
43 5
48
-- --
--
Ascend Collection
- -
-
Cambria Suites
29 -
29
-- --
--
Total Domestic System
327 443
770
=== ===
===
% Change
--------
New
Construction Conversion Total
------------ ---------- -----
Comfort Inn
0% (6%)
(4%)
Comfort Suites
(25%) (25%) (25%)
Sleep
1% 300%
6%
-- ---
--
Midscale without Food
& Beverage (12%)
(3%) (10%)
--- --
---
Quality
(55%) (4%)
(7%)
Clarion
17% 0%
2%
-- --
--
Midscale with Food &
Beverage
(29%) (3%)
(5%)
--- --
--
Econo Lodge
33% 8%
9%
Rodeway
50% 0%
1%
-- --
--
Economy
40% 3%
4%
-- --
--
MainStay
(45%) (100%) (50%)
Suburban
(62%) (100%) (67%)
--- ----
---
Extended Stay
(53%) (100%) (58%)
--- ----
---
Ascend Collection
NM NM
NM
Cambria Suites
(45%) NM
(45%)
--- --
---
Total Domestic System
(20%) (1%)
(9%)
=== ==
==
For the Three Months Ended
December 31, 2008
--------------------------
New
Construction Conversion Total
------------ ---------- -----
Comfort Inn
15 17
32
Comfort Suites
20 -
20
Sleep
25 1
26
-- --
--
Midscale without Food
& Beverage
60 18
78
-- --
--
Quality
1 39
40
Clarion
1 14
15
-- --
--
Midscale with Food &
Beverage
2 53
55
-- --
--
Econo Lodge
1 28
29
Rodeway
1 34
35
-- --
--
Economy
2 62
64
-- --
--
MainStay
5 -
5
Suburban
- -
-
-- --
--
Extended Stay
5 -
5
-- --
--
Ascend Collection
1 -
1
Cambria Suites
4 -
4
-- --
--
Total Domestic System
74 133
207
== ===
===
For the Three Months Ended
December 31, 2007
--------------------------
New
Construction Conversion Total
------------ ---------- -----
Comfort Inn
22 30
52
Comfort Suites
36 -
36
Sleep
38 -
38
-- --
--
Midscale without Food
& Beverage
96 30
126
-- --
---
Quality
4 57
61
Clarion
1 14
15
-- --
--
Midscale with Food &
Beverage
5 71
76
-- --
--
Econo Lodge
- 27
27
Rodeway
- 37
37
-- --
--
Economy
- 64
64
-- --
--
MainStay
12 1
13
Suburban
11 -
11
-- --
--
Extended Stay
23 1
24
-- --
--
Ascend Collection
- -
-
Cambria Suites
11 -
11
-- --
--
Total Domestic System
135 166
301
=== ===
===
% Change
--------
New
Construction Conversion Total
------------ ---------- -----
Comfort Inn
(32%) (43%) (38%)
Comfort Suites
(44%) NM
(44%)
Sleep
(34%) NM
(32%)
--- --
---
Midscale without Food
& Beverage (38%)
(40%) (38%)
--- ---
---
Quality
(75%) (32%) (34%)
Clarion
0% 0%
0%
-- --
--
Midscale with Food &
Beverage
(60%) (25%) (28%)
--- ---
---
Econo Lodge
NM
4% 7%
Rodeway
NM
(8%) (5%)
--
-- --
Economy
NM
(3%) 0%
--
-- --
MainStay
(58%) (100%) (62%)
Suburban
(100%) NM
(100%)
---- --
----
Extended Stay
(78%) (100%) (79%)
--- ----
---
Ascend Collection
NM NM
NM
Cambria Suites
(64%) NM
(64%)
--- --
---
Total Domestic System
(45%) (20%) (31%)
=== ===
===
CHOICE HOTELS INTERNATIONAL, INC.
Exhibit 7
DOMESTIC HOTEL PIPELINE OF HOTELS UNDER CONSTRUCTION,
AWAITING CONVERSION OR APPROVED FOR DEVELOPMENT
(UNAUDITED)
A hotel in the domestic pipeline does
not always result in an
open and operating hotel due to various
factors.
December 31, 2008
Units
-----
New
Conversion Construction Total
---------- ------------- -----
Comfort Inn
51 125
176
Comfort Suites
3 279
282
Sleep Inn
2 157
159
-- ---
---
Midscale
without Food &
Beverage
56 561
617
-- ---
---
Quality
69 14
83
Clarion
36
9 45
-- --
--
Midscale
with Food & Beverage 105
23 128
--- --
---
Econo Lodge
45
5 50
Rodeway
58
2 60
-- --
--
Economy
103
7 110
--- --
---
MainStay
- 38
38
Suburban
- 34
34
-- --
--
Extended
Stay
- 72
72
-- --
--
Ascend Collection
-
1 1
Cambria Suites
- 59
59
-- --
--
Total
264 723
987
=== ===
===
December 31, 2007
Units
-----
New
Conversion Construction Total
---------- ------------- -----
Comfort Inn
54 135
189
Comfort Suites
1 278
279
Sleep Inn
- 138
138
-- ---
---
Midscale
without Food &
Beverage
55 551
606
-- ---
---
Quality
71 15
86
Clarion
30
7 37
-- --
--
Midscale
with Food & Beverage 101
22 123
--- --
---
Econo Lodge
46
3 49
Rodeway
68
3 71
-- --
--
Economy
114
6 120
--- --
---
MainStay
2 46
48
Suburban
4 40
44
-- --
--
Extended
Stay
6 86
92
-- --
--
Ascend Collection
-
- -
Cambria Suites
- 63
63
-- --
--
Total
276 728 1,004
=== === =====
Variance
--------
Conversion New Construction Total
---------- ---------------- -----
Units % Units
% Units %
----- --- ----- ---
----- ---
Comfort Inn
(3) (6%) (10)
(7%) (13) (7%)
Comfort Suites
2 200% 1
0% 3 1%
Sleep Inn
2 NM
19 14% 21 15%
-- --
-- -- --
--
Midscale
without Food &
Beverage
1 2%
10 2% 11
2%
-- --
-- -- --
--
Quality
(2) (3%) (1)
(7%) (3) (3%)
Clarion
6 20%
2 29% 8
22%
-- --
-- -- --
--
Midscale
with Food &
Beverage
4 4%
1 5% 5
4%
-- --
-- -- --
--
Econo Lodge
(1) (2%) 2
67% 1 2%
Rodeway
(10) (15%) (1) (33%)
(11) (15%)
--- --- --
--- --- ---
Economy
(11) (10%) 1
17% (10) (8%)
--- --- --
-- --- --
MainStay
(2) (100%) (8) (17%)
(10) (21%)
Suburban
(4) (100%) (6) (15%)
(10) (23%)
-- ---- --
--- --- ---
Extended
Stay
(6) (100%) (14) (16%)
(20) (22%)
-- ---- ---
--- --- ---
Ascend Collection
- NM
1 NM 1
NM
Cambria Suites
- NM
(4) (6%) (4) (6%)
-- --
-- -- --
--
Total
(12) (4%) (5)
(1%) (17) (2%)
=== ==
== == === ==
CHOICE HOTELS INTERNATIONAL, INC. EXHIBIT
8
SUPPLEMENTAL NON-GAAP FINANCIAL INFORMATION
(UNAUDITED)
CALCULATION OF FRANCHISING REVENUES
AND ADJUSTED FRANCHISING MARGINS
Three Months Twelve Months
Ended
Ended
(dollar amounts in thousands)
December 31, December 31,
-------------- --------------
2008 2007 2008
2007
---- ---- ----
----
Franchising Revenues:
Total Revenues
$154,494 $168,975 $641,680 $615,494
Adjustments:
Marketing and
reservation revenues (81,904) (89,963)
(336,477) (316,827)
Hotel operations
(1,253) (1,207) (4,936) (4,692)
------ ------ ------
------
Franchising Revenues
$71,337 $77,805 $300,267 $293,975
------- ------- -------- --------
Franchising Margins:
Operating Margin:
Total Revenues
$154,494 $168,975 $641,680 $615,494
Operating Income
$34,097 $48,091 $174,596 $185,199
------- ------- -------- --------
Operating Margin
22.1% 28.5% 27.2%
30.1%
---- ---- ----
----
Adjusted Franchising Margin:
Franchising Revenues
$71,337 $77,805 $300,267 $293,975
Operating Income
$34,097 $48,091 $174,596 $185,199
Acceleration of management
succession plan
benefits 500
- 6,605
-
Employee termination benefits
2,731 141 3,537
4,250
Loan reserves related
to
impaired notes receivable
7,555 -
7,555 -
Hotel operations
(359) (368) (1,502) (1,451)
---- ---- ------
------
$44,524 $47,864 $190,791 $187,998
------- ------- -------- --------
---- ---- ----
----
Adjusted Franchising Margins 62.4% 61.5%
63.5% 64.0%
---- ---- ----
----
CALCULATION OF ADJUSTED NET INCOME
AND ADJUSTED DILUTED EARNINGS
PER SHARE (EPS)
Three Months Twelve Months
(In thousands, except
Ended
Ended
per share amounts)
December 31, December 31,
-------------- --------------
2008 2007 2008
2007
---- ---- ----
----
Net Income
$18,711 $27,947 $100,211 $111,301
Adjustments:
Acceleration of management
succession plan
benefits 313
- 4,135 -
Employee termination benefits
1,709 89 2,214
2,660
Loan reserves related
to
impaired notes receivable
4,729 - 4,729
-
----- -- -----
--
Adjusted Net Income
$25,462 $28,036 $111,289 $113,961
------- ------- -------- --------
Weighted average shares
outstanding-diluted
61,684 63,109 62,521 65,331
Diluted Earnings Per Share
$0.30 $0.44 $1.60 $1.70
Adjustments:
Acceleration of management
succession plan
- - 0.07
-
Employee termination benefits
0.03 - 0.03
0.04
Loan reserves related
to
impaired notes receivable
0.08 - 0.08
-
---- -- ----
--
Adjusted Diluted Earnings
Per Share (EPS)
$0.41 $0.44 $1.78 $1.74
----- ----- ----- -----
Adjusted EBITDA Reconciliation
(in millions)
Year Ended Year Ended
Q4 Q4 December 31, December 31,
Full-Year
2008 2007 2008
2007 2009
Actuals Actuals Actuals
Actuals Outlook
------- ------- ------------ ------------ ---------
Operating Income
(per GAAP)
$34.1 $48.1 $174.6
$185.2 $169.2
Acceleration
of management
succession plan
0.5 -
6.6 -
$-
Employee termination
benefits
2.7 0.1
3.5 4.3
$-
Loan reserves
related to
impaired notes
receivable
7.6 -
7.6 -
$-
Depreciation
and amortization
2.0 2.2
8.2 8.6
8.8
--- ---
--- ---
---
Adjusted Earnings
before interest,
taxes, depreciation
and amortization
(non-GAAP)
$46.9 $50.4 $200.5
$198.1 $178.0
===== ===== ======
====== ====== |